The Warren Buffett Way: Investment Strategies of the World’s Greatest Investor

ISBN: 0471177504
ISBN 13: 9780471177500
By: Robert G. Hagstrom Peter S. Lynch

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Business Currently Reading Economics Finance Financial Investing Investment Money Non Fiction To Read

About this book

The Warren Buffett Way offers investors their first in-depth look at the innovative investment and business strategies behind the spectacular success of living legend Warren E. Buffett. Tracing Warren Buffett's career from the beginning, Robert G. Hagstrom, Jr., tells us exactly how, starting with an initial investment of only $100, Buffett built a business empire worth $19.4 billion. Offers a close-up look at Buffett's highly successful investment theories and strategies; identifies the types of businesses Buffett now finds most attractive, and which ones he avoids; and based on the author's ten-year monitoring of Buffett's numerous shrewd investments and ventures.

Reader's Thoughts

Abdulrahman

If reading Benjamin Graham's Intellegent Investor is heavy, then this is your best alternative to learn from his best pupil and one of the richest people in the world: Warren Buffet. This book is very well written and lays out the important pillars to look at when considering a fundamental investment in money market equities.

Ahmed

الكتاب جيد وانصح بقرائته لكل من يفكر فى التعامل فى أسواق الاسهمكتبت هذا التعليق بعد قراءة النسخة العربيه من الكتاب المسماه ( الاستثمار فى الاسهم على طريقة وورن بفت) ... من ترجمة مروان ابو جيب وهى الطبعه الأولى وصدرت عن مكتبة العبيكان.والحكمة تختصر ب الشراء في القيعان حينما يكون الناس في هلع من السوق والبيع في القمم. واختيار الشركات ذات الاستثمار.

Jay

A nice introduction to investing in general and to Warren Buffett. A brief and interesting biography, a rundown of The Intelligent Investor and other influences on Buffett, an analysis of Buffett's investments (I can see why he's the best), and a summery of some of Thinking Fast and Slow.

Paul

I actually listened to the version narrated by Stefan Rudnicki - one of my favourite 'voice actors' - and he did a good job of bringing some life to the pages and making this somewhat tolerable.While the book does present and illustrate the Buffet investing characteristics with enough biographical information to flesh out the story in an interesting way, in the end the book's repetitiveness got to me.Buffet's philosophy is renowned for it's simple common sense. A great strength for investment theory, but a poison pill for someone writing on the topic. I couldn't help thinking the author really struggled to pad the material out to the requisite number of pages.

Terry Koressel

Warren Buffet is an American hero in my opinion. Humble, down-home, ethical, charming and intensely brilliant. The book is part biographical; part descriptive of the Buffet investment philosophies. Since Warren Buffet invests in simple, easy-to-understand businesses, the description of the companies in his portfolios are pure "Americana". Robert Hagstrom did a fantastic job writing the book....well-written and totally engaging. I was not bored for a minute. I enthusiastically recommend, particularly if you are Warren Buffet fan.

Naja Faysal

Now this book is really good because it really tells what makes buffet genius in a very simple and sensible way.

Jeffrey Sylvester

“The Warren Buffett Way” by Robert Hagstrom is a decent read depending on your purposes. On the one hand, Hagstrom comes off as a “want-to-be” ass-kisser of Buffett, in love with Buffet’s purported genius and the money he has, while on the other, revealing how Buffett consistently exceeded the index average of stock markets throughout his career as a focus investor. I purchased this book because I am currently studying finance (corporate finance at the moment) but the material consists mainly of definitions, concepts and metric tools. This book was helpful in that it demonstrated how those concepts and tools are applied when making ‘real world’ decisions in addition to describing some of the limitations of the assumptions made by scholars.Buffett’s experience overturns the general assumptions made by advocates of the “Efficient Markets Hypothesis”. The hypothesis states that any new information that emerges with the potential to influence the price of a security is reflected in the going market price. This is because millions of informed investors receive this information simultaneously and will instantly drive the price of that security back to equilibrium which limits the potential for large market returns (although there may be gains for those who wield efficient technology and who can make their transaction before equilibrium is achieved). As a consequence, many investors will promote diversification and stick with the level of gains that emerge from having index-based portfolios. Those who disagree, or feel they have the knowledge or methods to beat the market, tend to be “active” portfolio managers or “focus” investors who frequently change the composition of their portfolio based on their own analysis of business fundamentals and the likely future economics of each chosen industry. Buffett is a focus investor and his success provides the evidence that the market can be beat. To me much of what Buffett advocates is common sense. His basic premise is that the price of a security is not reflective of the intrinsic value of the business that underpins it. Therefore, the key task of investors is to focus their analysis on annual reports and to keep tabs of the trends that emerge to determine what spread exists between the going price and the company’s actual value. Buffett contends that investors should stick with the industries they know, not borrow too much money and should support companies with spendthrift managers committed to increasing shareholder value over the longer term. Perhaps most useful is how Hagstrom provides readers with several examples of how Buffett has applied these tenets to common stock purchases and portfolio management consistently and successfully over several decades. These histories provided me with some interesting insight into the development of classic companies like Coca-Cola, GEICO and Heinz as well as some insights of the metrics at play within the insurance industry. This book also provided me with a better understanding of how institutional investors operate including the ways in which they incorporate emerging information through a constant revision of probabilities to inform investment decisions.Overall the book met my needs but I would be frightened to discover any investor that wasn’t familiar with this level of material. I did however find the Buffett self-made myth a little nauseating.Sure Buffett is good with numbers, ambitious and had the will to stick with basic tenets throughout business cycles and the various fads that ensued but he was hardly from humble beginnings. Buffett’s grandparents were successful entrepreneurs with business connections and his father owned a brokerage in addition to being a banker and Congressman. They fronted him a substantial amount of capital early in his career making it questionable whether he could have flourished at the rate or extent he did especially when compared with someone not privy to those types of start-up advantages. In other words, he wasn’t near the American Dream that Hagstrom makes him out to be.One last bone of contention lies with Buffett’s philanthropy. At one point he took out a full-page ad in the New York Times stating how wrong it was that his secretary pays a lower tax rate than he does while quoting the miniscule tax he paid relative to the amount of money his collective investments make. For example, as stated by Arthur Laffer (developer of the “Laffer Curve” and former economic advisor to Ronald Reagan) Buffett paid less than $7 million in taxes in a year when he made $12 billion. If he had paid a flat rate tax (also regressive) of say, 12%, he would have paid $1.4 billion. His effective tax rate was six one-hundreths of one percent. So, even though he gave away under $2 billion to the Bill and Melinda Gates foundation he is doing substantially less to sustain the social contract (market democracy--the fabric that enables business to flourish and enables civil society) than his secretary; proportionately speaking. In other words, one would think he had better pony up on the philanthropy especially if he has any hope of justifying the misplaced flattery made by Hagstrom.3 out of 5 stars for Hagstrom!

Philip Hartman

Describes how the investment decision making process of the world's most successful investor. Good discussion of what makes a company valuable.

Murray Henderson

Fascinating.Clearly, Robert G. Hagstrom Jr.has a great respect for his subject and well he might. Warren Buffett is a man focused on the job in hand that of making money from his investments. Over the decades Buffett has proved himself to be the world's shrewdest investor and has made himself and his fellow investors VERY rich. When Hagstrom lays out the process in this book it appears worryingly straightforward - find a quality brand with few competitors in an industry you understand, look at the return on capital then buy the shares and let the good management have the time to prove their worth. It is that simple and yet few of us ever achieve financial security. Why not ? Perhaps that is the next book waiting to be written ? Anyway, if you are looking for a fascinating insight into how the 'Old Man of Omaha' operates, this book is a pretty good start.

Ray

I've read Buffett's biography before, which in hindsight, is a much better book. The title made me think the book is going to be about how Buffett invests. It is, but the bigger focus is giving account of what seems like every single company Buffett ever owned, and why. This case study sprinkled with investment principles is unfortunately neither as riveting as a biography nor as informative as a how to book.

Amethyst Mahoney

This was a pretty good book. It was surprising to me that the things I have said and done in the stock market all of these years are what Warren Buffet teaches! Guess I should put a little more time and energy into that. :-)

Pooja Kashyap

A few explanations are indistinguishable with respect to real practical application in analyzing companies and making investment decisions. A good read for those who are looking forward to study an introduction to Buffett.

Brad

I am not an expert investment guy. I wanted to find out more who Warren Buffet is and I was not disappointed. Ultimately, Warren Buffett believes in research, research, research when BUYING a company. When you buy a stock, you are purchasing shares in a company. Therefore, know that company. He looks at everything from quality leadership, past and potential future earnings, and most importantly, he asks anyone who is purchasing stock - do you understand the company and what they do. If you don't, don't buy them. Lots of great nuggets in this book and I have a better understanding of Buffett and investing overall.

Jeanne Daly

Even though this is an older book I thought it would be interesting to read about Warren Buffett and his investment strategies but I found it rather disjointed and not helpful at all. For me, this book did not flow very well and was challenging to slog through. I have so much respect for Warren Buffett and the success he has achieved but this particular book did nothing for me on any level.

Richard Stephenson

It's Warren Buffett - come on now. If you plan on investing at any level, then you've just got to know something about this man and his way of investing. If you're looking for a quick and to the point version, then I would probably recommend this book. If you're looking for the long and more biographical version, then I would recommend "The Snowball". Some of his decisions will make more sense (especially those that 'seemed' a little out of place for the Buffett-man).There was a good bit of expansion on Buffett's style, steps, and lessons combines with enough anecdotal example to put them into perspective. The fact that you're you and he's he was also taken into consideration... which is good considering someone making several billion dollars per year probably wouldn't be reading this book anyway.If this is your first venture into Buffett-ville, then you've done well. If this is just another Buffett book in your collection - nothing terribly new is here. Good all around Buffett exposure. Check it out.

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